Exhibit 14-8

question 22

Multiple Choice

Exhibit 14-8.An real estate analyst believes that the three main factors that influence an apartment's rent in a college town are the number of bedrooms,the number of bathrooms,and the apartment's square footage.For 40 apartments,she collects data on the rent (y,in $) ,the number of bedrooms (x₁) ,the number of bathrooms (x₂) ,and its square footage (x₃) .She estimates the following model: .The following table shows a portion of the regression results. Refer to Exhibit 14-8.The slope coefficient attached to Bed indicates that,holding other explanatory variables constant,

• A)An additional bedroom increases rent,on average,by $226.
• B)An additional bedroom increases rent,on average,by $526.
• C)An additional $226 in rent will lead to an additional bedroom.
• D)An additional $526 in rent will lead to an additional bedroom.

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Definitions:

Stock Investments

Financial assets representing ownership in a company or corporation, typically bought and sold on stock exchanges.

Investee

A company or entity in which an investor holds a minority interest, typically through the ownership of shares.

Net Loss

This occurs when a company's expenses exceed its revenues during a specific reporting period, resulting in a negative profit.

Net Income

The remainder of a company's revenue after deducting all expenditures and taxes, known as net profit.